In 1986, television reporter and talk show host Geraldo Rivera took a
national television audience into what was then one of the last remaining
landmarks of the Chicago crime era and the reign of Al Capone -- the old Lexington Hotel at the
corner of Michigan Avenue and 22nd Street. Rivera was in search
of lost treasure, a fortune that Capone had allegedly left behind in
secret vaults in the hotel. Earlier in the 1980’s, a local women’s
construction company had investigated the possibility of restoring the
hotel, which was by then merely a shadow of its former self. As they
searched the building, they discovered a shooting gallery that had been
used by Capone’s cronies for target practice and dozens of secret passages
and stairways, including one behind Capone’s medicine chest. The passages
led to hidden tunnels that connected taverns and whorehouses on the Levee
and to the immediate west. The tunnels had been designed to provide
elaborate escape routes from police raids and attacks by rivals.

The Lexington Hotel

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This led to more interest in the hotel and soon researcher
Harold Rubin came to the crumbling old building and began his own search of
the premises. In addition to recovering many priceless artifacts from the days
of the hotel's glory, Rubin also stumbled across one of the great secrets of
the place when exploring the escape tunnels. It was said that Capone also had
vaults in the lower levels of the Lexington where he had hidden away some of
his loot. These vaults were so well hidden that even Capone's closest
accomplices were not aware of them. Rubin's discoveries led to a newspaper
article in the Chicago Tribune but his excellent research would be
overshadowed by Geraldo Rivera, who stated that if the secret money vaults
could be found, he would discover them --- and would do so on national
television.

The Lexington Hotel had opened in 1892 and had been
designed by Clinton Warren, the architect of the famed Congress Hotel. The
brick and terra cotta building had been hurriedly opened to serve the masses
of visitors who came to Chicago for the 1893 World’s Fair. These were boom
years on the city’s south side and the fine hotel attracted scores of wealthy
and famous visitors, including President Benjamin Harrison, who once addressed
an audience from the balcony.

Al Capone, who became the Lexington’s most famous resident,
abandoned the Metropole Hotel (one block to the south) in July 1928 and moved
into a luxurious fifth-floor suite of rooms at the Lexington. He registered
under the innocuous name of “George Phillips” and ran his operations from the
hotel until he was escorted off the prison in October 1931. Capone held court
in an office that overlooked Michigan Avenue while in the Lexington’s lobby,
armed gunman kept a careful eye on the front doors. Additional guards with
machine guns patrolled the upper floors and were hidden away in closets.

Capone was ensconced at the Lexington during at the time of
his downfall, immediately following the infamous
St. Valentine’s Day Massacre. While this bloody event marked the end
of any significant gang opposition to Capone but it was also the act that
finally began the decline of Capone’s criminal empire. He had just gone too
far and the authorities, and even Capone's adoring public, were ready to put
an end to the bootleg wars. The massacre started a wave of reform that would
send Capone out of power for good.

Capone Bodyguard
Frankie Rio

Perhaps the strangest bit of history in regards to the massacre involves
the fact that Capone had not seen the last of the men who were killed on
that fateful day. In May 1929, Capone slipped out of town to avoid the
heat that was still coming down from the massacre and to avoid being
suspected in the deaths of several of the men believed responsible for the
killing of the Moran gang. While in Philadelphia, he and his bodyguard,
Frankie Rio, were picked up on charges of carrying concealed weapons and
were sentenced to a year in prison. They eventually ended up in the
Eastern Pentitentiary.

Capone continued to conduct business from prison. He was given a private
cell and allowed to make long-distance telephone calls from the warden’s
office and to meet with his lawyers and with Frank Nitti, Jack Guzik and
his brother, Ralph, all of whom made frequent trips to Philadelphia. He
was released two months early on good behavior and when he returned to
Chicago, he found himself branded Public Enemy Number One.

It was while he was incarcerated in Pennsylvania that
Capone first began to be haunted by the ghost of James Clark, one of the
massacre victims and the brother-in-law of Bugs Moran. While in prison, other
inmates reported that they could hear Capone screaming in his cell begging
"Jimmy" to go away and leave him alone. After his release, while living at the
Lexington Hotel, there were many times when his men would hear from begging
for the ghost to leave him in peace. On several occasions, bodyguards broke
into his rooms, fearing that someone had gotten to their boss. Capone would
then tell them of Clark’s ghost. Did Capone imagine the whole thing, or was he
already showing signs of the psychosis that would haunt him after his release
from Alcatraz prison?

Whether the ghost was real or not, Capone certainly
believed that he was. The crime boss even went so far as to contact a psychic
named Alice Britt to get rid of Clark’s angry spirit. Not long after a séance
was conducted to try and rid Capone of the vengeful spirit, Hymie Cornish,
Capone’s personal valet also believed that he saw the ghost. He entered the
lounge of Capone’s apartment and spotted a tall man standing near the window.
Whoever the man was, he simply vanished. Years later, Capone would state that
Clark followed him to the grave.

Capone’s days at the Lexington were numbered by this time
because in 1930, the United States government got involved in Chicago’s
dilemma over how to get rid of Al Capone. Washington dispatched a group of
treasury agents (Eliot Ness and his "Untouchables") to harass Capone and try
to find a way to bring down his operation. In the end though, it would not be
murder or illegal liquor that would get Capone, it would be income tax
evasion. He was arrested on October 6, 1931 and indicted. On October 17, he
was convicted on five counts, three of evading taxes from 1925 to 1928 and two
of failing to file tax returns in 1928 and 1929. He was sentenced to spend 11
years in a federal prison and was first sent to Leavenworth and in 1934 was
transferred to the brutal, "escape proof" prison known as Alcatraz.

The remnants of Capone’s gang abandoned the Lexington in
1932 and after that, the ownership of the hotel changed several times and the
state of the place declined with the surrounding neighborhood. It was re-named
the New Michigan Hotel in the 1950’s but soon after became a bordello, a
transient hotel and finally, a crumbling eyesore. By the 1980’s -- and the
arrival of Geraldo Rivera -- it was scheduled for demolition. But the
Lexington had one last act still left in its old bones.

On that night in 1986, Rivera and his camera crew went out
live to America from the deserted and empty hotel. The place had already been
picked clean by vandals and souvenir hunters, but Rivera was sure that secrets
from the past still remained in the place. In a basement chamber, the crew
blasted away a 7,000-pound concrete wall that was believed to be hiding a
secret compartment that contained thousands, perhaps millions, of dollars.
Even the Internal Revenue Service had agents on hand to claim their share of
the loot. When the smoke cleared though, only a few empty bottles and an old
sign were found. The fortune, if it had ever been there at all, had long since
been spirited away.

After Geraldo managed to try and upstage everyone in
Chicago who had researched Capone for years, the person who actually
discovered the location of the vault, Harold Rubin, got the last laugh. He
worked for the production company that produced one of the most-watched
television specials ever and was interviewed on CBS television on the night of
Geraldo's blunder. To this day, no one has ever done as much research into the
history of the Lexington and Rubin stands as the man who discovered the old
place's greatest secrets -- whether the vaults were now empty or not.

The Lexington Hotel finally “gave up the ghost” in November
1995. By that time, the ten-story hotel had fallen into ruin after years of
neglect and it was torn down. Another chapter in the history of Chicago crime
had been closed for good.